California Ballot Proposal to Establish Statewide Public Utility

Nick Eshleman

On Friday, October 30, 2015, California Secretary of State Alex Padilla announced that a ballot initiative has been proposed to replace most investor-owned utilities (IOU’s) in the state with a publicly-owned electric utility, California Electrical Utility District. The utilities to be replaced would include PG&E, Southern California Edison, San Diego Gas & Electric, and Bear Valley Electric, among others. Publicly-owned electric utilities would not be required to join the District, but could do so voluntarily. The district would be divided into 11 wards, each with an elected board of directors. The Legislative Analyst and Director of Finance reports that this measure would result in a “substantial net change in state and local finances.” A detailed assessment of the estimated impact was not made public, but will likely be revealed if the measure makes it to the ballot.

This initiative is being led by Ben Davis, anti-nuclear activist and former SMUD Rate Advisory Board member. Davis believes that this initiative will lower costs by removing regulatory complexities and shareholder profit considerations. On average, rates at publicly-owned utilities are 15 percent lower than rates at IOU’s nationally.

This is not the first time this initiative has been attempted; Davis had an identical initiative approved this year and a second one back in 2013, but was unable to get the required number of signatures on the petition by the deadline both times. Davis must collect 365,880 signatures by April 26, 2016, to move the process forward. If successful, the proposal will appear on the ballot in November 2016